U.S. Rapidly Moving In The Fiscal Direction Of Greece

In the 1980s and early 1990s, Greece was ruled by the late Andreas Papandreou, a firebrand anti-American Socialist who massively increased spending and debt during his years in office. It is he who many blame for today’s Greek debt crisis. Yet, despite his clear leftist ideology, even Papandreou came to acknowledge the unsustainability of his policies toward the end of his tenure.

“Either we make the debt disappear,” he warned, “or the debt will make the country disappear.”

As we know, Greece did not make its debt disappear and, increasingly, it is now Greece that is beginning to fade away — selling off its islands to the highest bidder, for instance, as it slowly descends into social anarchy.

The United States is rapidly moving in the fiscal direction of Greece (the head of the world’s largest bond fund suggests we’re already in worse financial shape) and, accordingly, we are now faced with our own version of Papandreou’s warning. Auctioning off the Statue of Liberty one day to service the debt may seem like a crazy proposition; I’m sure Greeks once felt the same way about their islands.

The bottom line is, we have a big problem. The Republican-led House of Representatives proposed and passed a budget to deal with our deficit. It cut spending and, over time, would have moved us toward balance. Yet, it was opposed by Democrats in the Senate — despite the fact that they still have yet to offer a budget of their own. And, as for President Obama’s budget proposal, it received no support in the Senate — not one Democrat or Republican considered it worthy of support.

So, House Republicans again took the lead and recently put forward their Cut, Cap and Balance proposal, which would have pushed through necessary cuts immediately, enacted enforceable caps to bring long-term spending in line with historical norms, and required Congress to simply do what each American family must do every month — balance its budget. Senate Republicans offered it up on the Senate floor, but the Democrat majority tabled it.

This makes three times the Democrats have said no to a budget, never putting their own proposal forward. This is despite the massive fiscal problems facing our country. In fact, as a clear example of just how out-of-control our problems have become, the Cut, Cap and Balance proposal would have only gotten next year’s deficit back below $1 trillion!

Most Arizonans I talk with refuse to believe Congress can’t reduce spending. And they’re right. Instead, President Obama insists we must increase taxes. I strongly disagree with him. Our problem is wasteful Washington spending, not taxes. I can’t predict at the time of this writing what the next “deal” will be. But if it fails to curb spending, count me out.